Tim:
Sounds like some of Michael's speech was maybe a
treaty with the free software people. [laughter]

Anyway, there probably are divisions within
Microsoft just as there are divisions within our community. It's kind
of interesting, because the diversity of opinions often leads not to
division but to strength, and I think we're going to demonstrate that
strength as we hear from a number of people who are prominent in our
community and are allied under the banner of the core principles of
open source, but who do have different takes on how it works and
what's important about it.

Anyway, I'd like to invite up the rest of our
panel. Michael and Craig, you may want to come back up and sit
down.

I have here with us Brian Behlendorf, who's one of
the cofounders of the Apache Project. [applause] I'll just start down
at the far end, then.

Clay Shirky is a partner at an incubator called
the Accelerator Group. He's also a well-known commentator on coming
technologies, and he's recently done some very interesting thinking about some of Microsoft's new technologies, in particular Hailstorm.
That's why he's here to talk to us. [applause]

Dave Stutz is, I believe, now the program manager
for the shared source implementation of the common language run time
and so forth. Is that the appropriate designation?

Tim:Yeah, I was going to say, I don't know, maybe
something like, if you had the hat [reference to the red hats on
heads all through the room], I would say, "Mini-Me. Do not chew
on your hat." [laughter]

Next in line is Mitchell Baker, who's known as the
Chief Lizard Wrangler at Mozilla.org. Mitchell is also the person who
wrote the Mozilla license,
so she's done a lot of thinking about free software and open source
licenses and the needs of corporations. [applause]

We have with us Ron Johnson, who's an attorney at
Arnold & Porter and the chair of the 22nd Annual Computer and
Internet Law Institute.

And obviously you know Craig, and I already
introduced Brian.

So, Craig, I don't know if you wanted to respond
at all to any of Michael's comments [laughter], or whether you want
to hear from a few other people before we get there.

Craig:
I'll just offer one general thought, which is, you
know, in some sense it's easy to poke fun or think you know what is
the look-in from the outside and to be at Microsoft.

We're a company now of 50,000 people, and among
any community of 50,000 people, particularly fairly smart people,
you're going to have a lot of people who think carefully about a lot
of issues, and feel passionately as you do about a lot of issues. So
I don't think we're embarrassed at all to find that people would come
forward at Microsoft and ask questions or ask whether we do the right
thing or not.

What I can tell you is that there is a
single-purpose focus in the management of the company. The leadership
of the company is not uncertain about what we're doing. We welcome
people asking questions in the company, but ultimately we recognize
our job is to make decisions and provide consistent leadership. And
so if people don't like what the company wants to do, there's no
indentured servitude. You know, they're free to go do something else.
But the company is clear about what it will do. And I can just tell
you that as a member of a management committee of the company, and
while listening to Michael's comments that many of the ways he
characterizes what he thinks may go on inside the company in terms of
a civil war or anything, frankly [it] just doesn't exist. It may be fine
to ruminate about what you think could exist or does exist. I can
tell you quite specifically, there's no civil war at the management
level and, to me, no observable civil war among the rank and file
either. So that's one thought I'd leave with you today.

Tim:
So, Brian, you're obviously someone who has, you
know, come up from the GPL side of the house but from the university
style of license regime. Clearly you have done a lot of thinking
about what licenses you would choose and why. Do you have any
thoughts on that, or any things you'd like to talk to Craig about
with regard to the BSD orientation.... [laughter]

One of the slides in [Craig Mundie's] presentation
was actually a very useful slide. It showed that there is a
relationship  a set of relationships  between the
public research through universities, corporations, users, and
government. I think what we've seen is that it's not
one-directional like that. What we've seen is that it's actually
bi-directional in all those things  in fact, bi-directional
across universities and consumers and government and business and all
those directions.

And so while Apache, for example, is under a
BSD-style license, it was very important while we were building the
Apache community that we not only have other corporations use it and
adopt it into their commercial products, but also that we communicate
to those companies the need to reinvest back, the need to build
Apache itself as a strong force as they build up the momentum behind
it. And to us, even though the obligation isn't there to share their
code back, the companies that are participating in the Apache
Software Foundation and even more broadly, within the BSD communities,
understand the need to reinvest, to build it back up. And that's one
thing that I think may be missing in some of this debate: the
creation of licenses, the creation of regimes that really are
bi-directional, that really put all the participants at an equal
level.

I totally welcome Microsoft exploring shared
source licenses. I think for proprietary software, I'd much rather
have the code to it than not have the code to it. I think we're going
to see a big difference in the amount of resources that people will
put in to a shared source license regime versus one that is an open
source license regime. So it's all a matter of experimentation. I'm
all for experimenting with different licenses. I think history has
shown that open source is a more efficient way to go in certain
circumstances. At the same time, there are 10 million Microsoft
developers out there who might have a different opinion. I think it's
worth finding out.

For the bulk of the panel discussion, Dave Stutz and Craig Mundie defended Microsoft's business position to the other panelists. Do you think this conversation helped bridge the gap between open source and Microsoft?

Craig:
One thought on that. I agree with you that it is
bi-directional, and in a way, when you look at all the different
licensing regimes, you're correct to point out that there are many
different ways to give back. In a sense, giving the code back
is just one way. You know giving taxes to the government to give back
is essentially another institutionalized way.

Tim:So how much does Microsoft pay in taxes? [laughter]

Craig:

It's a lot. I don't know the exact number this year,
but it's billions. One of the things that we've been fascinated by,
and I guess you could say it's some benchmark of this, [is that] this
week, as I kind of predicted in May, we actually came out with this
Windows CE source license. I guess we actually
posted it three, maybe four days ago. And the first three
days, ten thousand people downloaded the entire source tree. And we
had had a kit that we had offered to people who just wanted to use it
for commercial purposes and we had sold about four hundred of those
in the last year. I guess only time will tell whether people will
decide that they really want to make an investment or whether they're
just curious. But we were quite happy to see that when we offered it
for non-commercial use  really targeting the academic
environment, primarily  that ten thousand people in the first
three days decided to take it and take a look at it. So we're
enthused with that kind of reaction, and it is, you know, some way of
giving back. You know, we give back financially, we give back in the
standards world, as Michael said, with XML and other things. I mean,
well before XML, we've been a big participant in the process of
standardization, and so I think we will continue to seek ways to
share and give back.

Tim:Dave, I'm sort of curious. You're sort of closer
to the hacker level inside Microsoft. What did you think of Michael's
comments about a war within Microsoft over the license thing?

Dave:Well, I don't think there's a war going on. I
definitely think that we're trying to internalize a lot of good
things from this community, though. There's a lot of people who
have paid a lot of attention to the open source community and to all
of the issues that surround sharing source code, and as you all know,
sharing source code  the whole process of sharing source code
 is an entirely different beast than sharing binaries that
have been tested to work together and packaged up on a disk and sort
of sold as a unit. And we're in the process of internalizing that
right now.

We've shared source with developers for many,
many, many years. We have a huge developer community.
The samples and MSDN
programs and that kind of thing have been out there for a long time
and have been heavily utilized and helpful, I hope. But people do ask
for more and more access to source code. It is becoming much
more central to a lot of people who do development on a daily basis,
and because of that, we've started developing all these different
kinds of licenses. And those licenses are the individual product
groups at Microsoft responding to customer needs, basically.

For example, the project that I'm working on is
based on a standard, based on the ECMA specs for CLI and C#. It's the same
standard that Miguel is
working on in Mono. And I
have worked to design the license effectively as a long-term
investment of the intellectual capital that we've been putting into
the work, ongoing work on our CLR. It's a good example of some place
where we're really trying to invest in a different way, and it's
reflected in our license.

By the way, for those who haven't seen it, the new
licenses are one page long [he holds up a copy]. They're definitely
worth going
up, download the thing, and take a look at it. We're trying to be
very clear. It's a document that's trying to be clear and simple. And
I'm around. I'd actually like to hear feedback from people here.

Tim:By the way, I just want to say among the members
of the panel  feel free to jump in on each other, because
there's nothing worse that everybody kind of waiting. [Laughing on
panel]. I just kind of feel like we're getting the conversation
going

Dave:I feel like Michael wants to talk. [Laughter]

Michael:I'd like to move a little bit from the nuance to
the substance, and to say that I very much appreciate the analogies
that have been brought forward both by Craig and by Dave on the kinds
of efforts that they're making, but it sounds to me like the logging
companies will be really, really nice guys as long as you let
them cut down the trees, or the oil companies will be very
sensitive to the environment as long as they can drill for oil.
And the way in which this concerns me in the software world is that,
in spite of what the shared source license or whatnot may offer,
there are some things that are still very concerning to us related to
how patents are being used to prevent interpretability and to prevent
the open source or free software communities from fully participating
in what the future of the Internet will be. And so from my
perspective, the substantial important difference here is a question
of whether it is acceptable to where it's convenient provides some
limited access to some particular resource while still excluding and
preventing

Tim:I'm going to jump in here, though. I
mean... I'm going to speak for Microsoft. As I understand the
position of Microsoft, what's wrong with the right of somebody
creating something to set the terms on which it's distributed? And if
that works for their customers, why is that wrong?

Michael:The reason it's wrong is because people can
incrementally build up systems that are patently unfair. And we have
seen this time and again in the case of civil liberties and human
rights, that an incremental divergence between those who make the
rules and those who are forced to live under them ultimately becomes
untenable and ultimately, the revolution occurs. [applause]

Tim:So the point you're making, then, is really that
it is not necessarily so deep an opposition between proprietary
software and free software as the fact that Microsoft has massive
marketing power and that creates distortions.

Michael:For me, it's not a question about whether or not
one group of people or another are allowed to use the water fountain
or wash room. It's whether or not we have full access to
everything from education to economics to marital choices and what
not. [applause]

Mitchell:Actually, I want to address that from the point
raised earlier of the effects of an environmental niche, open source
software and public policy choices that result. The equilibrium that
we have today in the software industry is flawed. It has a critical
flaw in it. That flaw is a flaw of choice. Among the choices that
were listed on that slide was not included the choice of leadership.
And that is one of the things that open source software allows.
[applause]

And in our world today, thanks to the very smart
and successful people at Microsoft, vast amounts of the data and
software and information flow that we rely on as individuals and
societies are controlled by one entity. That is not a healthy
ecological system. It's not healthy for us as individuals or as a
society, and is ultimately not healthy for development of software
and related services in the future. Clearly [applause]

Clearly there are many smart and innovative
people at Microsoft, and I imagine that within the buildings of
Microsoft, that we don't see, there is a massive outpouring of new
ideas and creativity. But the issue is that those get filtered
through the business plan of a single entity, and what we as a
society and a world need, going forward, is software we're not yet sure
about  is the unexpected and the serendipitous combination of
new things combined with a choice of leadership, where we go, who we
follow. And that's the core of the open source software world.
And that's why the public policy considerations should promote
the flourishing of open source and free software, and I'm very
concerned that policy implications... that an effort to characterize
open source and free software as bad for public policy could be
undertaken, and more concerned that it might succeed. [applause]

Craig:I'll offer you three thoughts, okay? Some
personal and some corporate. First, as I said again and again,
there's no attempt on our part to characterize open source per
se as bad, or bad from a policy point of view. [sarcastic
laughter from audience]

Tim:
[To audience] Please. Keep it cool.

Craig:
Secondly, the ecosystem of software in the future
will not be strictly about the things we call computers.

Mitchell:Absolutely.

Craig:And so, the system you talk about retrospectively
has largely been one where we knew what the computers were.

I can tell you in the first six years that I was
at Microsoft, my job was essentially the non-PC world, and I can tell
you that Microsoft has little sway with the world's telephone
companies, consumer electronics companies, etcetera. In fact, arguably,
we've had limited success in trying to get any of our
technologies adopted in those other regimes. [one person applauding]
That's great. I mean it's your opportunity. I mean, with or without
government intervention, okay, I can speak personally that there are
plenty of people who say, "Boy, you know, we have hegemony in
our markets already. We have customer relationships. We have
technologists. We have choice." All right? And I can attest to the
fact that they've been able to effect those choices. So I think you
have to really be thoughtful about what you think the future world is
and where the intersection between government oversight, public
policy, and the evolution of computing is.

Clay:I'd like to jump in a little bit on this idea of
the future world, and to pick up on some of Craig's comments about
the ecosystem, and to say  as much to this group as I said to
Microsoft  that I think the issue of source code considered
alone is less important now than it was five years ago, and will be
much less important five years from now, because the number of times
that applications are running on a separate box in a separate
location than the operating system they are interacting with is going
to explode through Web services and through peer-to-peer
architectures. And I think the meta-issue we're concerned about here,
with an ecosystem, is interoperability, not merely open
source; and to me, when I think about this future world, I'm more
concerned with open interfaces, which is increasingly how we're going
to have our ecology constructed, than I am with the source code that
lies behind those interfaces, which is often not exposed.

So: our questions for the Microsoft folks,
probably more for David than for Craig... In the Hailstorm documents,
and in the demo and the white paper,
you noted that Hailstorm's schemas are straight XML, no special sauce
 demo'd Hailstorm running on Mac OS, a Palm OS, and Linux
box

Craig:[garbled] access from those points

Clay:
Right. Those were running as Hailstorm end
points. And there was a mention in the press conference, though not in
the white paper, that there would be ways for Linux and Solaris
servers to participate in Hailstorm, although that participation
wasn't defined. So the question I haven't seen answered in public,
that I'd like to get an answer to is: Can I have  can I use
a Hailstorm schema to have a Palm Pilot communicate with a Linux
server, without contacting a Microsoft server during that
transaction?

David:[To Craig] You going to take that or shall I?
Okay. We absolutely recognize that in a distributed world,
interop is key. Right? No question about it. And as Craig pointed out,
there are a number of industries which sadly have not yet seen the
light and are not running all Microsoft software. [laughter] Alas.
[laughter] I'm sure they'll wake up.

And so from a customer perspective  and we
always come from a customer perspective  I know I just need to
keep pounding that  the customers are going to want it, and we
will definitely make it possible. There is no question that we will
do that. It's the right business choice. It's the right choice in
terms of policy. It'll happen.

Michael:So you'll do that when everybody else is dead.

Dave:
No, Michael. [Inaudible]

Clay:To be fair to Microsoft, that's not true on
device classes where they don't have the monopoly. So there are kind
of two Microsofts here, and there are places where they don't have a
monopoly and they behave very differently. I want to re-ask the
question and try and get a yes or no. [laughter and applause]

Dave:
Okay. [applause] I failed.

Clay:Yeah. Can I have a Hailstorm transaction without
phoning home to Microsoft during that transaction?

Dave:So, that is a.... [laughter]  I'll try to
explain. I'll give you a yes or no. I'll say... yes?

Clay:All right.

Dave:But I will caveat that with [laughter] much
 as you know, in distributed systems, the interesting things are
done when the parts are brought to the table that you need, right?

Dave:So if Hailstorm is wildly successful, and people
are using Microsoft services provided from Microsoft farms,then it's
highly likely that that Palm Pilot is going to want to perhaps
do authentication and then to federate data from the Linux server
with the authentication information. Right?

Clay:No question. And obviously I was simplifying the
question by asking for a simple round trip. But the question was
whether or not it's a choice or requirement. And I hear you saying,
"It's a choice."

Craig:Let me give you my analogy, and it probably won't
be perfect, but the way I think of it, in programming individual
machines in the past, the programmer's interface was the APIs. And
the API was essentially a protocol and schema of an interface for an
operating system. And in the world we see coming, it became clear to
us  for our own account  that we couldn't depend on
things happening only within one machine. We believe that the
traditional notions of distributed computing, in terms of remote
procedure calls and things like that, was the right model, and that in
fact you needed to have loosely coupled systems, broadly defined. And
that that really says in that world, protocol, schemas, and message
packets essentially are akin to APIs. Microsoft has always published
the APIs, and in fact as this community does, they borrow those APIs
and they do whatever they want with them. They emulate them, produce
completely independent implementations. So once we publish the
protocols and schemas for interfacing through a Hailstorm service or
any other .Net service, I don't know why anybody can't take and do
what they do with an API spec today, which is use it as they want to
use it. But

Tim:
Can I ask a question about that? I know
there's been some concern in this community about the sort-of second
generation of the SMB protocol being protected by patents to help
keep it from being reverse engineered. There is sort of this feeling
that Microsoft has a strategy that control  and hey, if it's
not going to be controlled via, you know, binary programs, it's going
to be through patents. So maybe are we going to have open shared
source but patent protection? [applause]

Craig:Sure.

Tim:So in fact there is still a tool whereby you
could keep people from

Craig:
But look: we're a business, okay? We're in
the business of licensing intellectual property. So if it turns out
that in the future that business says, "Okay, we should license
the patents to people who use that in order to be compensated for the
development of intellectual property," maybe we'll do that.
You're always welcome to come and ask us to license anything from
sources to patents. But I mean, we are a business. We're not

Tim:But Apple was a business when you copied
their interfaces and, you know [laughter and applause]

Craig:Steve would tell you they still are a business.

Brian:I think even aside from the patents issue, even
aside from the publication of the API issue, you still have a
question of centralization.

Let me use, as an example, DNS. DNS is a quote
"distributed system." That's the D in DNS, right? But we
all know that there are a set of root name servers out there. Those
root name servers used to be managed by a government entity. And that
was privatized. And
certainly the Internet exploded, certainly there's been a lot of contention
over the privatization of those root name services and other people
going after promoting alternative root name servers. The fact is
right now that is a critical point in our infrastructure, and people
are concerned about that.

And I think, likewise, we are similarly concerned
with .Net and Hailstorm  that there could be a similar
centralization taking place. Where today to go look up a DNS, to look
up a host name, you have to ultimately go to a root name server to
find out  you know the details. I think there's people
concerned that the same type of centralization may come to be
inherent in deploying .Net services.

And taking a step back from that, I think a lot of
what drives people towards open source is the desire to remove
centralization from the software development, from the software
distribution model. And I think that's something that's very right
for all of us to think about, to be concerned about

Craig:
I guess there's two things to think about.
Right now, I mean, we've gone out and told people, "This is what
we're going to do." All right? We didn't wait and just deliver
a fait accompli. All right? We actually have advertised our
intentions, all right? The down side to doing that for us, you know,
I mean  I recently read about AOL deciding to come up with Magic
Carpet. What do you think that is, okay? I mean, they
said, "Oh, this may be a good idea, this thing over here
Microsoft's talking about. Maybe we should have one, too." So it
isn't clear to me that we are granted any automatic franchise in this
area.

Tim:[Let's] come back to a point that Mitchell made,
and that's really the health of the overall ecosystem and I think
some of the concerns that people have. I think one of the big
differences between Microsoft and the rest of the world is that you
guys [Microsoft] see yourselves as still a relatively small player in
a much bigger world that you want to be part of. You see a lot more
markets where you don't have that power.

For most of the people in this room, you are the
universe. You are, to use Scott McNeely's phrase, "the top
predator." And in this ecosystem, there is a concern that there
really is not enough to go around.

You mentioned the size of the software industry
earlier, and you mentioned the number of companies. I remember an SPA
study a few years back  you know, the average software company
with ten or fifteen employees, which if you do the math is most of
those that you talk about  does not make money, because a few
big players are making all of the money in that industry.

And we've basically created a situation where it
is very, very difficult for new entrants to compete in the
traditional software industry. [applause] And I think a lot of the
attraction to open source is people saying, "We want in. We want
an opportunity as developers to have a chance to have our ideas
flourish." And you guys have been so successful that you've created a
market where it's difficult for developers outside Microsoft to have
a chance to succeed. So I'm kind of wondering if one of the issues
behind this whole proprietary source versus open source debate is
really, "How do we get to a health in the ecosystem?" Is it
"What's good for Microsoft is good for the software
industry?" at this point? The two may diverge.

Dave:Tim, don't you think that the reason that 
one of the reasons that it's hard to enter the industry now is that
the expectations of the consumer have been brought up by the quality
of software that's out there? I mean we've written  all of us
have written very good, high-quality software, and it's continued to
raise the bar over time.

Tim:My experience is that it's actually pretty easy
to enter in new markets that are outside the scope of what people
have thought about at Microsoft. It's not very easy to get
very far in those markets, because then Microsoft comes in and uses
its current market power to basically take over those markets. So you
see cases again and again where somebody comes up with a good idea
and they don't get very far.

Dave:Well, perhaps I've got a unique viewpoint, but
I've certainly been inside Microsoft and seen repeated failures. It
is not the case that we automatically are granted the
franchise.

Tim:Oh, I understand that.

Mitchell:But one of the things that Microsoft has is
plenty of ability and money and backing with which to fail.

Craig:Sure.

Mitchell:And also  I'll finish in a minute 
the other thing that Microsoft has, which is pertinent in this open
source debate about making money  is a very efficient system
for taking money out of certain aspects of the software market. It
can do that by giving products away for free  like the browser,
so there's no money in the browser any more. Or by rolling it into
the OS or into Word or whatever. And so in that system, where
Microsoft has, rightly or wrongly, as a business matter, the ability
to extract all of the money out of given areas of software
development, I'd say it's open source  where people join
together and voluntarily produce something more than any one of them
can do [alone], and jointly create a work without direct payment
 that is the only way to get innovation in these areas.
[applause]

Tim:Dave?

Dave:So I think one of the points that Craig was
making a minute ago, that I'll come back to... We recognize that we
are in a position in which we have a lot of resources and that people
are sensitive about this, and we have started saying, trying to be
very clear about what our intents are, and trying to work with
people in the community to carve out places that are safe places,
such as the ECMA standard, for example. And so we need, as a
community, as a whole, to continue to develop ways that enable
businesses based on free markets, which is where we are, to continue
to exist  but also for ways to foster trust and innovation.

Tim:Well, let me ask this question: Would it be a
fair analogy to say that Microsoft is shifting from a hunter-gatherer
economy to a farming economy? And that part of the goal of shared
source is to say, "Hey, we've got to breed innovations, we can't
just sort of expect them to sort of happen out there?"

Dave:Well, you know, I am a farmer, actually  as
Tim knows, I have a farm. So I'd like to think yes. But Craig, I
don't know, what would you say to that?

Microsoft would be nothing if it wasn't for the
fact that millions of people wrote apps and deployed them on PCs. I
mean, just offering an operating system is not an interesting
business per se. And so [audience and panel laughter]
It's true. I mean, it's a fact. If you don't have a
symbiotic relationship between the platform and the users of the
platform  both the ultimate consumer and a development
community for it  the thing will not sustain itself. So in a
way, maybe we already were a farming economy, in that we depend on
having a lot of people both develop for and use this thing. And in a
way, as this world has changed, as people have diversified both the
number and type of platforms that are interesting, and you get this
incredible device diversity, I think we've been forced to recognize
there's no direct transference. And again, I reiterate I can
personally speak to our inability to transfer any of our PC
franchise to any of these other ecosystems.

Tim:Is that part of why the GPL bothers you so much?
Because it's getting so much traction, and Linux is getting so much
traction on embedded devices?

Craig:No. No. In fact, our concern about the GPL is
strictly the fact that it creates its own closed community.

Tim:But so does Microsoft. [applause]

Dave:No, no, it's not true.

Tim:Yes. [applause]

Craig:I mean, that's fine. If the GPL community wants
to explain how people get to stand on their shoulders in both the
commercial world and the academic world, fine.Then that's what this
debate should be about, to elucidate that.

Brian:[Let's] compare the GPL to the shared source
license. The GPL tells me as an entrepreneur, as a businessman, the
terms under which I can use that software. Right? It sets boundaries,
it says what I can do, what I can't do, how I can incorporate, how I
can't, that kind of thing. The shared source license, at least the
one for the Windows CE release that I saw, says "This is the
noncommercial use license. Contact us for terms under for commercial
use."

Craig:That's right.

Brian:As a businessman, it doesn't tell me how I can use it.

Craig:Call us up.

Brian:Well, let me ask the audience here. How many
people here write software completely, only, for hobbyist purposes?
Not for their employer. Not for some commercial purpose. [pause] A
few, I'd expect. But certainly the vast majority here write software
[that has] some other commercial purpose. So in the spirit of helping
Microsoft come up with a good shared source license, perhaps 
maybe I shouldn't do this, but  you know, if it even said,
"A dollar per CPU that it runs on," or something like
that.

Craig:Anybody who wants to know, call us up, allright?
And we'll figure out, well, what is it you want to do? We'll give you
a price. Just call us up!

Brian:Granted. That sets up a different set of
relationships, though. The shared source license itself does not
define a community of people who are part of that community the same
way that open source licenses do.

Dave:Actually that's not true. Specifically, in the CE
community, not only is there the noncommercial license, which is the
one I was waving around, but we also have a community-based
source-sharing effort with people that build devices commercially. It
is in fact set up around the notion of everybody sharing changes


Tim:
I saw Ron trying to get in there for a
moment and he hasn't had a chance to say anything.

Ron:I'll give the suits'  as the lawyers are
known  perspective on a couple of these questions. The legal
business is just only recently getting into debating the
interpretation of these licenses and the enforceability of these
licenses. But we've been advising companies on drafting these
licenses for a long time, and most of the commercial software
companies draft licenses tailored to their distribution, tailored to
their parsing of intellectual property rights, tailored to their best
commercial interests. Now that is not just a Microsoft problem. That
is the problem for virtually every large software company that at
least I'm aware of, save a couple. The trouble with the GPL, to
companies who are doing commercial development, is in fact it doesn't
at all cause clean lines.

The language in the GPL that tells you what you
can do without being subject to the redistribution provisions in the
GPL is expressed in about four different ways in the GPL. None is any
more specific than the basic derivative work standard of the
copyright law. Some of the others' expressions of that standard are
inconsistent with the derivative work formulation under copyright
law. Now we've been litigating that standard in the software business
for over twenty years, and there's been very, very little guidance
after twenty years of litigation.

I've tried cases on the meaning of that standard.
There's been very little guidance from the courts as to what
constitutes a derivative work. It's clear that it goes beyond code.
It's clear that it goes into the levels of abstraction above code.
But beyond that, there's been no articulation of a useful test. The
test that's most often used by courts is in fact dangerous because it
makes the court feel, when it gets through the test, like it's
accomplished something  when in fact, as any programmer would
know  it's just starting the analysis.

So the trouble with integrating any kind of
commercial software with the GPL is going to be in part that there's
a huge uncertainty as to whether you can do that  and where
you're going to end up five years from now.

Brian:If the uncertainty was clarified  I mean,
Stallman's working on Version 3 [of the GPL]  if Microsoft
wanted to participate in that, I'm sure he'd welcome their
feedback.

Craig:We already are.

Ron:One trouble is that 

Craig:
One sec. We put up all these questions and
say: "Here. Here's twenty questions. Ask yourself these
questions." You can't answer these questions by looking at this
license. I'm mean that's pretty clear guidance where the problem
is.

Michael:What I just heard is that the derivative work
clause in the Microsoft shared source agreement is something to be
feared because in fact it has stipulations about what is covered by
intellectual property rights concerning derivative works of
authorship. And if derivative works of authorship extend beyond code
into abstractions  if I look at Microsoft software, I'm
infected. [applause]

Ron:The language that has classically been chosen by
companies depends on the kind of software. For example, the 

Michael: The language is derivative work of
authorship. It's the same language in both licenses.

Ron:In some context, that makes sense as a standard.
In other contexts, where you're trying to establish a generalized
standard for all software, it doesn't. Now Microsoft obviously has,
like most other software companies, a whole series of license
agreements that include different standards and different language
and grants of rights depending on the nature of the software


Tim:I think we need to wrap this because we're going
to run out of time, without time for the audience. I think in general,
I would say as a layman the GPL and Microsoft's proprietary licenses
actually have more in common on some axes than the GPL and the
university licenses, which tend more to the public domain. They're
both strong intellectual property licenses and they probably both
have ambiguities that  in the case of Microsoft licenses 
probably have been litigated more often than the GPL. But anyway,
let's not go down the legal hole because we know what we're talking
about here. [laughter]

Microsoft has stated that the GNU GPL is an un-Americancancer, yet this country was founded on the principles of freedom. The
GPL was founded on those principles of freedom. These foundations of freedom inspired others to create the
companion open source movement, and now the two movements stand
together around an important intellectual commons. This debate is
covering well the relevant business models and methodologies, but
we'd like to challenge you, Mr. Mundie, or another Microsoft
executive, to a second debate with the authors of the GNU GPL on the
philosophy behind the GPL. Mr. Mundie, will you accept that
challenge?

Craig:I'm willing to discuss it. [applause]

Bradley:We have a conference October 10 in Washington
D.C. You're invited. Will you be there?

Craig:Call Rick Miller and we'll talk about it. [applause]

Tim:All right. That would be really nice if you'd do
that, because I think there really is a lot of interesting dialogue
that could happen there. Richard [Stallman] is trying to rewrite the
GPL, and we may actually  it would be very interesting to get
that input.

Craig:Richard didn't manage to join the dialogue we had on the Web at siliconvalley.com, or
anything else, so I'm kind of interested in why.

Tim:Okay, go ahead. Next question. [laughter]

Carl Holden:Hi. In the interests of full disclosure,
actually, I'm Carl Holden from CollabNet, the same company as [Brian]
over there. This question is also directed at Craig Mundie, mostly
because he's the person whose answer I can least predict.
[laughter]

Craig:I'm sorry. My answer what?

Carl Holden:You're the person whose answer will be least
predictable, I suspect. So this is more directed at you than perhaps
to the others. You were talking about ecosystems and choices earlier,
and the subject of patents came up and then sort of got skirted
around a bit. I think there's little debate in this room, probably
even from you and others with Microsoft, that a lot of software
patents are pretty ridiculous. But Microsoft, I'm sure, holds a lot of
them, and you expressed a willingness to have Microsoft enforce them,
even when the violator is an open source programmer. Do you agree
with that?

Craig:Absolutely.

Carl Holden:No matter whether the patent is a good patent, a
just patent, in the sense of patent law?

Craig:If you want to basically violate  you or
anybody else  somebody's patent. Right? Then you always have
the choice to challenge the validity of that patent. And there's a
well-established legal process 

Carl Holden:[inaudible]

Craig:Pardon me?

Carl Holden:Takes money to challenge that, too.

Craig:Fine. Get your money. [audience laughs, hoots]

I mean, look, the society, over decades, has decided
that in order to find a balance between rewarding innovators and
having a pure intellectual commons that we grant patents as one form
of intellectual property protection. This is something that has been
debated academically, legally, over many, many years. And it's always
an interesting question. And you can say it's an interesting question
today. People say, "Well, should we have patents?" Well,
that question got asked a long time ago. Right now, at least, our
society has said, "Yes, we still have them." In fact,
there's more tendency to say we're going to have more, not less. I
agree with you that the biggest challenge, as far as software
patents goes, is that it's a relatively new field, it evolves quite
quickly, and the examiners are really probably not as good as they
could be, relative to giving out patents, but nonetheless, if they
give one out, it bears legal weight, whether we have it, you have it,
or anybody else has it.

Craig:
Well, at the end of the day, if you have a
patent, you enforce the patent if it's valuable to you. And so I
think that Microsoft and other people who have patents will
ultimately decide to enforce those patents.

Brian:Are there any patents that apply or that will
apply to implementers of .Net or Hailstorm?

Craig:I expect there certainly will be. I mean, the
patent process takes a long time.

Brian:So you've applied for them?

Dave:Actually, though, I think there's a really
interesting point to be made. I think in the long run that patents
will benefit open source as a structural thing. I think that in order
to get large commercial entities like us involved  and you said
you want us. We want to be there. So eventually it's going to happen


Brian:We want you on our terms.

Dave:Ha. [laughter] Oh, I see. So the, ah  now
that's not very [garbled]. [laughter] I think that in order to keep
clear relationships, we need to develop ways to talk about those
relationships and ways to litigate those relationships in the
unfortunate circumstances where people come to disagreement, right?
But certainly one of the things you can do with patents is you can
share the source, because the patent is outside the source, and there
are licenses as well, so there's lots of different ways to manage
those relationships. You need to help us by telling us what else
needs to exist, and we will help you in terms of making those things
come to be.

Craig:It's also fascinating, just to close on that
point, to go back and look at both the academic world and among some
of the most notable people who contributed to the intellectual
commons, and find that they all held patents on their original
contributions and made money off of them.

Tim:Next question.

Clay Claiborne:Craig, in December your boss Steve Ballmer declared Linux and open source the main danger to
Microsoft in the coming year. And so it's July and here you are. I
want to take advantage of this to ask you some questions. Okay, I'm
Clay Claiborne from Cosmos Engineering. I've been a
member of the Microsoft community as an OEM provider from DOS
3-something and a member of the Microsoft developers network when it
first began, and I've been a member of the open source and free
software community since Windows 95 was introduced. [laughter] So I
have some experience in both communities. I understand the open
source community  open is free or probably about two hallmark
words to come to mind. This is a community that believes not only in
open source but open dialogue, not only in free software but free
speech and free markets 

Dave: and free beer.

Clay Claiborne:Yeah, and free beer. Indeed, free beer. But with
Microsoft, I'm a little vague because until recently I don't recall
you referring to yourself as a community. Now the word
"community" is broadly used. The CIA says it's part of the
intelligence community. [laughter] The LAPD considers itself a
community. I would like from you to get a better idea of what you
mean when you refer to Microsoft as a "community," because
it sounds like earlier you said that yeah, there was freedom in the
Microsoft community. If any of the Microsoft serfs disagree, they
were free to leave. [applause]

Tim:Let Craig answer the question, and thank you very
much. Let him answer the question please.

Craig:I'm not sure I know what the question was.

Clay:Can you define community? In Microsoft.

Craig:Microsoft actually has a number of communities.
You could say we have our internal community, that's our employee
community. We have our developer community. That's people who choose
to take our tools and write some code. All right? We have a customer
community. That's people who buy our products directly and use them.
[So] there are a variety of communities. My comment this morning was
that, with respect specifically to the developer community, we 
and by the way, we do use that term [community] and have used it for a
long time. What we recognize is that we can do a better job in
addressing the needs and in perfecting our relationship on an ongoing
forward basis with our developer community, and we're investing
heavily to do that.

Audience member:I have a question for Craig. You spoke of the
software ecosystem, and as Tim and Mitchell pointed out, in the
traditional software market, you're a cash cow and [in] the business of
most of those of us in the room, you have an overwhelmingly dominant
position. And as Microsoft goes forward in trying times, it's
difficult to maintain annual growth and revenue of 15 or 20 percent.
And we all know that exponential growth has its limits. In the
interest of the software ecosystem  and I'm speaking now of the
traditional market  is it time for Microsoft to declare not
zero population growth but zero revenue growth?

Craig:Well, I don't think so. [laughter] I mean, our
fiduciary responsibility to shareholders pretty much would preclude
that. Our job in our publicly held company is to in fact provide
return to the shareholder. That is the end job.

Audience member:Do you also have a responsibility to the ecosystem?

Craig:Well, absolutely. Sure. I mean Microsoft tries to
be a good corporate citizen. I personally spend a lot of my time
involved in a lot of issues, including critical infrastructure
protection for this country. Okay? And many other things that have
little to do with the direct business of Microsoft. And so people at
a personal level and at a corporate level really do try to step up
and deal with some of these issues that people think are an issue of
corporate responsibility.

Tim:Next question.

Mark Vercallo:Yes. I'm Mark Vercallo with the Electronic Frontier Foundation.
[applause] I'm just a sysadmin [laughter, whoops, approving
applause]. One of the issues that concerns me is that we're in a more
monolithic society. We have a monolithic press. We have a monolithic
government of cookie-cutter politicians. The oil companies, the gas
companies, the electricity companies, have us under their thumb. And
the only thing that seems free anymore is the free software, the free
Internet, the free speech community. Now, in that battle, the way I
see it is that your community has taken a hostage in one of the
members of our community and that Dmitry is still in jail at
this time. And I want to know how Microsoft feels about the
enforcement of the DMCA, whether or
not that you are going to continue to take hostages in our community
for free speech, free expression, and putting people in jail for open
source and speaking their  using code as a form of free speech.
[applause]

Craig:I suggest you address your question to Adobe.
[applause]

Audience member [off-mike, shouting]:Did Microsoft lobby for the DMCA?

Craig:We talk to people all the time. [groans of disbelief]

Right now the DMCA is what it is. It's the law of
the land. All right? So we and you and anybody else has a right to go
try to get it changed if you don't like it. But it is the law of the
land.

Tim:So, Craig, let me ask a question. Does Microsoft
like it?

Craig:There's aspects of it we like and there's aspects
we don't like. We're like you.

Tim:Well actually there's very little I like about
it. [laughter and applause]

Dave:Your business depends on copyright, Tim. Right?

Tim:Right. But I figure the DMCA breaks the rules in
that it basically  it goes too far against fair use.

Craig:Write your congressman.

Tim:Well, I've spoken to him 

Dave:No, he has spoken out, no question about that.

Audience member:My name is Robert Lydie. I'm speaking not
so much from my current work background as by formal training as a
biologist. We've been talking a lot about ecosystems. But one of the
things that we have, as biologists, learn[ed] about ecosystems is that the
width of the ecosystem has something to do with its vitality. When
you get narrow ecosystems, what are called the monocultures, which we
do fine with in farming occupations, you have to do things to keep
these systems viable. You have to start [using] pesticides. You have to do
other things. If we've got a force that's all the same type of tree
and we get parasites, a red worm goes through and destroys it. What's
the vision that Microsoft and the other commercial firms that are
such a thin culture, a monoculture? How are you going to protect
yourself form these red worms?

Dave:We want a healthy ecosystem. And actually, in all
seriousness, metaphors aside  and those are wonderful tie-ins
 it's very, very important to our business as well as your
businesses to have a healthy ecosystem.

Audience member:Buy breadth. Have Linux. [laughter]

Dave:There ya go.

Brett Glass:Okay, my name's Brett Glass. I'm known as a writer for Boardwatch magazine, among other
things, and somewhat of a rabble rouser in the community. In the
interest of brokering peace between the camps here, I'd just like to
ask a question. During his talk, Michael said that Microsoft shouldn't
engage in a winner-take-all strategy. The problem I see here, though,
is that the GPL is also a winner-take-all strategy. As a matter of
fact, if you remember  I'm sure most people here have read the
GNU Manifesto --
Richard Stallman said that one of the effects of the GNU
Project was to eliminate competition in the realm of operating
system.

Now, this is sort of scary, in light of what our
previous questioner just said. The GPL also has the potential to destroy, or at least weaken, the ecosystem by
creating a monoculture. So I guess the question is: Why should we be
going to the other extreme? Why advocate the GPL, rather than some
sort of fairer regime that allows room for both, such as the Apache license, for
example. Why not offer something to both camps, rather than going to
one extreme to the other? [applause]

Tim:Well, I would have to say this is probably a
loaded hot potato and I'm not afraid of those. I have to say I've
spoken out quite clearly: I think that the university licenses are
the best balance between freedom and the ability to make money. I
think that is a choice that many projects have made. At the same
time, I really respect and support the right of Microsoft to put out
software under a proprietary license, and I really respect the right
of people who want to use the GPL to put out software on [garbled]. I
think the very fundamental right, you know, of freedom
zero, for me, is to offer the fruit of your work on the terms that
work for you.

Craig:It's all about choice.

Tim:Yeah [applause], and I think that that's really
what's absolutely critical here, and I think the fact is, let there be
competition in the marketplace. I mean that's the answer. I mean let
people use whatever license they choose, and if their customers don't
like it, they will have other choices. And I think because of
technological changes, we are entering an era of greater choice. The
fact is, Microsoft's past history is past, and we really are entering
a new era, and it's a result not just of open source but of profound technological changes, and I think the future is open and we can make that future be what we want it to be. [applause]

And we probably need to end on that. If you want
to ask Craig more questions, go to the free software event in
October. [laughter]